European trade proving challenging for firms
As we approach the 100 day mark after exiting from the EU transition period, the new Chamber EU Trade Report highlights significant challenges facing firms as they adjust to new trade procedures. Following the end of the transition period on December 31st 2020, and the eleventh hour signing of the UK-EU Trade & Co-operation Agreement (TCA), firms were given only the shortest amount of time to prepare for new trade procedures. The TCA made no provision for trade in services and for manufacturers, new border checks were put in place as we left the single market and customs union.
West & North Yorkshire Chamber chair, Nick Garthwaite said, “Findings contained within the EU Trade Report highlight significant increases in transportation costs faced by many firms, in large part down to increased bureaucracy. Firms also reported inconsistencies in border checks across EU member states with 60% of manufacturing companies saying they had experienced difficulties exporting and 1 in 2 had faced challenges bringing goods into the UK. Many regional firms reported border delays, with examples of deliveries that would previously have taken 2 days to arrive at customer premises now taking 50 to 60 days and in some extreme cases goods which had left the UK in January were still being held up and awaiting clearance into the EU.
“Whilst the TCA retains tariff free access for UK goods which meet rules of origin criteria, the report highlights that this agreement is the worst possible deal for those firms whose business model relies on distribution of goods made outside of the EU.
“The Chamber has concerns that the increased cost of doing business within the EU may put many companies off, causing them to scale back or withdrawing entirely from trading within the EU.”
The Leeds City Region and York & North Yorkshire Enterprise Partnerships have both made funding available to support firms get to grips with new trading arrangements. John Alderton, Office Managing Partner, Squire Patton Boggs who supported the Chamber’s report said, “We are delighted to work with the West Yorkshire Combined Authority and LEPs from across Yorkshire on the provision of an EU Exit Legal Clinic. For many years, we have supported clients through legal and political change and with a team that includes sitting members of the UK Parliament, former World Trade Organization officials and members of the European Parliament, we are well-placed to guide businesses through the uncertainty and help them develop effective strategies to address and manage change.”
West & North Yorkshire Chamber is calling on the government to continue to support companies as they adapt to these new trade procedures. Looking to the future, we are hopeful that once firms gain more confidence with such things as rules of origin that they will start to expand their horizons. If a product or service sells well within the UK or EU then chances are there is a market for it elsewhere around the world.
Chamber International continues to offer support, expert advice and training for companies across the UK. More information available at https://www.chamber-international.com/